Bitcoin is very close to breaking a bearish pattern that suggests a price drop and confirming the current uptrend, possibly signaling the start of a bull market.
Bitcoin’s price has found support above $30,000 and is aiming for the year’s high at $31,000. This upward trend began last week and coincided with discussions about the possible approval of Bitcoin spot exchange-traded funds (ETFs) in the United States.
There was a surge in interest when fake news spread about the Securities and Exchange Commission (SEC) supposedly approving BlackRock’s Bitcoin spot ETF proposal. This false information led many investors, particularly retail investors, to increase their exposure to Bitcoin, contributing to the ongoing rally beyond $30,000. At present, Bitcoin’s price is at $30,664, showing a 2.6% increase in the last 24 hours.
Spot BTC ETF Approval’s Impact on Bitcoin Price
Bitcoin’s price has risen significantly, nearing its yearly high of $31,000, primarily driven by the momentum generated by fake news regarding the approval of a spot ETF. If an actual BTC spot ETF gets approved, it could invalidate any bearish sentiments and potentially serve as the launchpad for the early stages of the next bull market, leading up to the 2024 halving event.
The approval of a BTC spot ETF could attract a substantial inflow of capital from traditional investors. These investors prefer buying shares of the ETF through traditional stockbrokers, bypassing the complexities associated with acquiring and storing digital assets on crypto exchanges.
Moreover, the approval of a spot Bitcoin ETF would validate Bitcoin’s status as a mature asset, a milestone long awaited by crypto enthusiasts. The anticipated influx of institutional funds from the traditional financial market could trigger a significant rally. When combined with the upcoming halving event, this inflow of funds might set the stage for the 2024/2025 bull market.
JP Morgan released a research report speculating that multiple spot ETFs could be approved, especially following the SEC’s decision not to appeal a recent court ruling in the Grayscale case. Grayscale, the largest digital asset manager, aimed to convert its Grayscale Bitcoin Trust (GBTC) into a spot ETF. While the exact timing of the approval remains uncertain, it could occur in the coming months.
Bitcoin Price: Challenging the Bearish Fractal?
Bitcoin’s price is currently following a bullish trend, particularly after a double-bottom pattern breakout. This pattern suggests that Bitcoin is likely to continue moving upwards, potentially surpassing the $31,000 resistance (its yearly high) and aiming for $33,577.
BTC/USD daily chart | Tradingview
Traders favoring this upward movement are also keeping an eye on the Moving Average Convergence Divergence (MACD) indicator, which issued a buy signal on October 16.
Additionally, the bullish sentiment is supported by the formation of a golden cross pattern. This happened when the shorter-term 21-day Exponential Moving Average (EMA) (in red) crossed above the longer-term 100-day EMA (in blue).
A clean break of the ~$31,000 highs is the final step to fully invalidating the Bearish Bitcoin Fractal$BTC #Crypto #Bitcoin pic.twitter.com/gT5IXSoSQG
— Rekt Capital (@rektcapital) October 23, 2023
Rekt Capital, in a Twitter post, outlined the criteria for invalidating the Bearish Fractal. However, it’s essential to note that a potential pullback below the $30,000 level is still possible, especially if the resistance at $31,000 proves to be strong and unyielding.
At Range High resistance after breaking its multi-month Lower High
Reclaim red as support and/or Weekly Close beyond would likely confirm a breakout beyond the Range High
Until then, there is scope for a pullback into the high ~$27k for a retest$BTC #Crypto #Bitcoin pic.twitter.com/UHHMxBloTC
— Rekt Capital (@rektcapital) October 23, 2023
Currently, the advantage is with the bulls, and their primary goal is to achieve upward momentum beyond the critical $31,000 level. If they succeed in breaking and maintaining this key level, it would confirm the strength of the rally and potentially pave the way for the double-top pattern’s target breakout at $33,577 and further gains above $35,000.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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